Drivers of Farm Household Incomes in Rural Tanzania

Katera, Lucas Albani (2014) Drivers of Farm Household Incomes in Rural Tanzania. PhD thesis, University College Dublin.

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The broad objective of this thesis is to contribute to the on-going debates on identifying drivers of farm household incomes in rural Tanzania. In doing this, we focus our analysis on growth consequences of the human capital, in the form of formal schooling attained, and financial capital, in the form of off-farm employment, in promoting rural economy. These are done indifferent chapters. Chapter two examines the role played by formal schooling on farm productivity. Using Heckman framework, formal education is assumed to affect farm outputs through its impacts on adoption of innovations. Our findings support relative importance of basic education over higher education in agriculture. This suggests that basic literacy skill, usually attained during primary schooling, is very relevant in farm productivity because of its impact on the adoption of innovations. Chapter three focuses on the driving force of off-farm income generating activities and the extent to which such forces are accessible to poor households in rural Tanzania. The chapter makes use of the utility maximization theory in which a farmer’s decision to offer labour to the off-farm employment depends on the utility derived from such employment. Our results show that decision to go to off-farm employment is the result of push factors due to the lower incomes from the farm sector. Poor households have relatively higher incentives to offer labour to off-farm employment to compliment low farm incomes. However, barrier to entry remains an obstacle to off-farm employments because such employments require capital up-front. Chapter four discusses the role of off-farm employment on adoption of modern farm technology and food security. We also use utility maximization framework in which the utility of adopting a technology is compared with utility of not adopting it. We find that off-farm employment increases the adoption of labour saving practices and decreases the adoption of labour intensive practices. However, we find that off-farm employment increases food security and the quality of nutrition. This means there is a big shift in rural Tanzania from producing food to purchasing food, thus off-farm employment remains an important destination to assimilate excess labour that cannot be fully utilized in the farm sector.

Item Type: Thesis (PhD)
Subjects: H Social Sciences > HC Economic History and Conditions
Divisions: Africana
Depositing User: JHI Africa
Date Deposited: 28 Jan 2015 11:57
Last Modified: 15 Mar 2018 12:43

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